Global oil prices rose on Monday after the United States and China reached a framework agreement on trade, just days before Presidents Donald Trump and Xi Jinping are scheduled to meet in South Korea.
The agreement, brokered during the ASEAN summit in Malaysia, aims to prevent the imposition of 100% tariffs on Chinese goods beginning November 1 and includes discussions surrounding the potential sale of TikTok in the US.
Treasury Secretary Scott Bessent confirmed the progress of talks held between October 25 and 26 in Kuala Lumpur, where he met with Chinese Vice Premier He Lifeng.
At 10:09 a.m. local time, Brent crude traded at $65.42 per barrel, up 0.34% from its previous close, while West Texas Intermediate (WTI) rose 0.37% to $61.73.
Market Optimism Grows
Expectations of a U.S. Federal Reserve rate cut also bolstered investor sentiment. Newly released inflation data showed the U.S. Consumer Price Index coming in below expectations, leading markets to price in a 25-basis-point rate cut at the upcoming October 28–29 policy meeting.
However, geopolitical tensions continue to weigh on the oil market. The U.S. recently imposed sanctions on Russian energy giants Rosneft and Lukoil, effectively cutting them off from Western financial systems.
The sanctions could constrain Russia’s export capacity, potentially tightening global oil supplies through Q4 2025 and keeping prices elevated into early 2026.
Analysts warn, however, that Russia may attempt to reroute exports through non-Western partners like India and China, though logistical and financing challenges could limit the impact.
Market watchers now await the outcome of the Trump-Xi meeting in South Korea, which is expected to finalize details of the trade deal framework
